Gas prices surge as summer approaches

Costs jump in just a month, but analysts aren't predicting last year's $4 peak highs.

May 30, 2009|By Robert H. Orenstein OF THE MORNING CALL

Kenny Acosta had seen gas prices rise recently, so he scouted out the area before pulling into the 7-Eleven on S. Fourth Street in Allentown. At $2.37 a gallon for regular, the price was the lowest around.

"It's not too bad," said Acosta, who lives in Allentown. "I just pray to God, and I hope it doesn't go higher and higher and higher."

Drivers have been seeing higher gasoline prices, evidenced by a 20 percent jump over the last month alone, according to the federal Energy Information Administration.

Nationally, as well as in the Lehigh Valley, the average price of a regular gallon of gas is $2.43. But that price is still well below the $4.05-per-gallon peak last July.

That's little comfort to Shirley Reiff of Emmaus, who was getting gas at the Getty station on Lehigh Street in Allentown.

"It stinks," said Reiff, who paid $2.43 a gallon for full-serve.

The rising price of gas has followed the price of a barrel of crude oil, which has doubled in the last six months, reaching $66.31 on Friday.

Theresa Podguski, director of public affairs for AAA East Penn in Allentown, said several factors have coincided to cause rising prices: the unofficial start of summer, when people drive more, increasing the demand for gas; unrest in Nigeria, Africa's largest oil producer; the Organization of Petroleum Exporting Countries maintaining production levels; and some sectors of the economy showing signs of improvement.

"All of these factors do play into the price of crude," she said.

Earlier this year, the Energy Information Administration projected the average price of a gallon of regular gas to reach $2.21 a gallon this summer. But that price was surpassed already.

For gas prices to hit $3 a gallon, crude oil would need to approach $100 a barrel, well above even the highest projections this year of $70 to $75, said Tom Kloza, publisher and chief oil analyst at Oil Price Information service.

Still, many industry watchers, including Kloza, have been surprised by the recent gasoline price increases.

"If you had asked a month ago if we would see a $2.50 national average, I would have said no."

Podguski said it's hard to predict where gas prices will end up this summer.

"I think that the prices are going to stabilize here," she said. "We maybe will see a little bit more of a spike, but I can't predict how high they can go."

Nonetheless, the current price is enough to make Bonnie Erie, also of Emmaus, think about finding a job that's closer to home. She works for a car dealer in Quakertown and recently paid her monthly gas bill of $400.

"Just when you're getting ahead a little bit, they get you," she said at the Getty station.

Bill Jensen of Allentown, who was filling up at the 7-Eleven, said the price of gas has him wondering whether he should stay home this weekend rather than drive to the Poconos.

Acosta said if gas continues to climb much more, he'll consider taking a LANTA bus to Dorney Park & Wildwater Kingdom, where he works as a porter.

"I've just got to deal with it the best I can. Everything gets higher and higher," he said. "You have to go with the flow."